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Eurozone To Impose Capital Controls On Greece If No Deal By Weekend: German Press
Just as we hinted earlier when we reported that the ECB may use the "nuclear option" on Wednesday and yank Greek ELA, here comes German Suddeutsche Zeiting with a report that Eurozone countries have reached a Greek emergency plan (yay)... which calls for the imposition of capital controls on Greece if no deal is concluded by the weekend (oh no).
From SDZ (via Google translate):
The euro partners have agreed in the face of the solidified negotiations with Greece on a contingency plan for Athens. This became known on Monday in Berlin and Brussels. It stipulates that creditors want to give the Greeks initially another chance and wait to see if by the end of the week it is possible to Euro finance ministers to agree with the government in Athens to the corners to meet the current emergency program. The ministers meet Thursday and Friday in Luxembourg.
Elapses this deadline without agreement, to be convened without further delay a special meeting of heads of state and government in Brussels. In an interview for this is Friday night. At the special summit a political solution should be sought again. French President Francois Hollande warned on Monday against the failure of the negotiations. The deadlines were extremely short. "I have often said: caution, we now come in a period that can be turbulent, if no agreement is found," he said during a visit to the air show in Le Bourget near Paris.
Via Bloomberg:
- EURO-ZONE COUNTRIES READY CAPITAL COUNTRIES FOR GREECE: PAPER
- CAPITAL CONTROLS TO BE READIED FROM COMING WEEKEND: PAPER
- EURO-ZONE COUNTRIES REACH GREECE EMERGENCY PLAN: SUEDDEUTSCHE
EURUSD dumped on the news...
And rather stunningly, DAX futures spiked on the news (which was somewhat oddly reported as a posiive by Bloomberg)
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Finally. Fuck off Greece. Go suck on Putin's tit now. Could not care less about any "russian pivot". They can pivot wherever the fuck they want.
Throw those pathetic Greek deadbeats out of Europe already.
Europe will survive as long as it doesn't unite. Too late, I guess.
I'm a bit rubbed raw on the Greece doomporn, so to speak.
Ten more rapid fire articles on Greece, good or bad, and I'm gonna start posting in bold type like Wolferl to just throw the motherfuckers out already.
pods
For sure, that will kill the German banks.
Greece can play its trump card here; that is give no f*ck.
Hint for the locals: suck those ATM's dry.
You mean to tell me Dooshe Bank has some issues?
So the EU places capital controls on Greece. So the Greeks start dealing via Moscow and Beijing. No?
Unintended Consequences are a Bitch.
Unqualified comment. Google "Target 2".
If the EU is going to impose capital controls on Greece, Greece should tell the EU to take their capital and stick it. Kick the bankers out, crash the system, bring back the Drachma, leave the EURO and start over.
That's exactly the ultimate outcome anyway. Depends on how it is arrived at, I guess. The old saying: "How do you want your NO, fast or slow?"
FUCK the EU!!!!
I just wish they would! But they LOVE the Euro and want to keep it! Now what? How can you ween them?
Ge·sta·po(g?-stä?p?, -shtä?-)
n.1. The German internal security police as organized under the Nazi regime, known for its terrorist methods directed against those suspected of treason or questionable loyalty. 2. gestapo pl. ge·sta·pos A police organization that employs terroristic methods to control a populace. adj.
1. Of, relating to, or characteristic of the German security police organized under the Nazi regime. 2. gestapo Of, relating to, or characteristic of terroristic police methods or operations: gestapo tactics.
Ge·sta·po -
is the german abbreviation for: Geheime·Staats·Polizei.
translated from german it means: Secret· State·Police.
much like the CIA (Central Intelligence Agency)
NAZI
is the german abbreviation for: Nazional Sozialist
translated from german it means: National Socialist.
Hitler came to power via the NSDAP
is the german abbreviation for: Nazional Sozialistische Deutsche Arbeiter Partei
translated from german it means: National socialist German Workers Party
this is all that these names really mean:
National Socialist and secret state police.
any other meaning you want to attach to any of these past and present Regimes,
is up to you, after you get to learn the meaning of the words.
WR;)
Appropriate clarification ...
If they are trying to convince the average joe that the EU is not a dictatorship, they are failing miserably with statements such as this. I guess the gloves are coming off and they don't give a tinkers damn about what anyone thinks. Pretty bold move.
Greek had plenty of time to anticipate. They have EUROs and US$ in their mattresses or abroad. Capital controls will touch bankrupt Greek banks, surrealistic. Tourists have to beware, they risk to stay in Greece longer than forseen (no more jet fuel without cash payment).
Actually the EU IMPOSING capital controls would be very different from the Cyprus playbook- where the local puppet government rubber stamped DB's demands. Because there is supposedly free movement of capital within the EU, which can under certain circumstances (Article 65) be restricted by a member State within its own borders.
Furthermore money and capital are legally distinct- see Annex I of Directive 88/361/EEC Capital for Leona Helmsley's "little people" are delineated in section 11 and don't include bank deposits (or bank notes).
Grab some popcorn and watch a(nother) bunch of treaties get turned into nothing more than "pieces of paper"
Showdown is this week.
If Brussels doesn't deny this, and this weekend comes and goes without a deal and without bailouts -- Greece won.
If we get a deal, Greece loses, if we get capital controls, everyone loses.
This explains where Ghordo has been. Maybe he can come here and give us a list of what to buy like he did in 2012. That would be great.
Greece loses no matter what. If they agree to deal, any deal, a little less. Hope those pathetic fuckers jump the cliff and are out.
Greece leaves the EMZ, and stays in the EU. Russia and China jump in with $50 Billion in "investments," both get warm water ports, and a permanent veto in anything EU related.
Watch.
So what? Let them invest in Greece if they want. Give them a few ports in Greece. And if the Greeks veto too much in the EU they get kicked out completely. There´s nobody in central and western Europe who has a strategic interest in Greece, this is a US empire thing and they have to solve it.
What color should we choose for the revolution in Greece? Blue?
A Russian once told me -- "Why hasn't there been a revolution in Washington DC yet" "Because there isn't an American embassy there."
>>> And if the Greeks veto too much in the EU they get kicked out completely.
There is no mechanism to kick a member nation out of the EU.
And to introduce such a mechanism would require Greece not to veto that introduction.
They can, and will, cut off their money, but not their voting rights.
If all the other EU members tell Greece they are out, they are out. It´s as easy as that.
It's not that simple.
It is.
No it isn't, and it isn't even a violation of Aticle 2, which would be the method of suspending Greece's voting rights.
Even the ECB agrees with me...
No, the ECB agrees that a member can be expelled, the argument is Art. 50 of the treaty. If you don´t want to go that way you can use the Vienna treaty convention, this is possible here since there is no outspoken legal framework in the EU treaty about kicking a member out. And of course there is that general legal thought that a member of a legal entity can be expelled by the vote of ALL the others if necessary.
Article 50 pertains to withdrawal, not expulsion. The ECB working paper covered why Article 50 couldn't be amended. The VCLT is irrelevant since it depends on either TEU provisions, or the consent of all parties, which includes Greece (same problem as TEU amendment to include a clause prescribing expulsion).
Article 50 is the argument, since all the other EU members could withdraw and form a new EU at the same moment without Greece, without Greece having a vote on that. VCLT doesn´t depend on TEU, if TEU has no legal framework for a certain topic, like the expulsion of a member state, and of course that member state has no vote in that decision. And there is this general legal thought that a member of a legal group can be expelled if it violates the rules of the group.
And that just legal aspects. If all the other members of the EU decide that Greece is out and stop every cooperation what will Greece do about it?
Have you ever read the VCLT clauses on expulsion? What exactly do they say as pertains to a forced Grexit?
As to all the other EU member states dissolving the EU and reconstituting it, well they would have to reconstitute it, and that would involve successfully ratifying the new treaty in each member state- with no EU in the interim, so it's a non-starter.
Your a stupid idiot. Seems to me you never read anything of the VCLT. Or you didn´t understand. Probably both.
Ad hominems are are the last resort of a sore loser. Put up or shut up.
I'll be nice and give you a hint- it's part 5 of the treaty.
Remember your original point was, "It´s as easy as that."
Greece couldn't make a go of it with hundreds of billions in hard currency. They're defaulting. Couldn't do it in a currency union with 500+ million consumers.
Right, the Russians and Chinese will be all over that....
Russia and China don't have $50 billion to waste either. Imo this "trump" card is overplayed.
Putin alone dropped $50 billion just in Sochi.
I think he and the Chinese together could come up with the sum. If not, throwing the Greeks anything at this point & time will get you a first class state visit, roses at your embassy, a warm water port or two and an Island.
$50 billion is just the buy-in. Then come the neverending obligations. I don't care to be honest. Let them take it over. The Chinese (COSCO) owns the port anyway. Italy has plenty ports and is close enough.
German banks have full backstop of German FinMin, Bundesbank and ECB.
ECB is dying to buy German BUNDS all day and night long with QE. Why would they line up to buy more crap Greek paper?
At least Bunds are good collateral. Equivalent to USTs.
I would say Bunds are better than USTs if you are coming at it from a Capital Preservation perspective.
They might as well buy some Deutsche bank paper while they're at it. You know, tranche F Cayman Islands FYM (fuck your mother) SPV subordinate.
And when the German BUNKS fail then it will take down the London BUnks followed by that of the US BUNKS,
THERE IS NO CONTAINMENT. Since the USA is the World's Reserve Currency it will make EVERY BUNK, including Russian BUNKS and CHINESE BUNKS INSOLVENT.
It is OVER.
But really the GERMAN BUNKS are already gone as cracks in the outer structure began appearing WEEKS BEFORE the Greek Default.
When cracks appear in the OUTER SHELL you can be assured that the internal structures have failed.
The writing was on the wall when Oil dropped 60% in the past year .
Oil, like every other commodity, has many DERIVATIVES associated with it. That major collapse sent the highly LEVERAGED DERIVATIVES MARKET so far ut of balance that no recovery from the imbalances are possible.
DOUCHBUNK is the largest holder of Derivatives and has experienced fatal damage.
Why in the hell were their CEOs let go?
Greece is THEATER FOR THE MASSES.
But the entire Global Banking System is TOAST...KAPUT...DEAD!!!
This is far, far worse than when I saw that Cliff Chart published on the St. Louis Fed Bank publications back in February of 2008 that demonstrated that Reserves were all of the sudden NEGATIVE rather than positive.
I knew it then that it was over. I know it now that it is over. The writing is on the wall and there is NO WAY OUT.
Good luck.
You spewer of hope, you.
… you misspelled
“sewer” --
On the brighter side, we will have achieved a cashless society, just not the way
TPTW(ere) are planning.
It can stagger on for a few months still though.
I guess I had better get my hog farm up and running. Who runs Bartertown, BITCHEZ!
This was Lehman (NSFW):
http://www.sexshopik.cz/images/o/watermark/dildo-flesh-tone-limpy-extra-...
Is this Greece? (You guessed it - NSFW)
http://i00.i.aliimg.com/wsphoto/v1/2019982080_1/Sex-Toys-for-Woman-12-In...
Are we rapidly approaching the BOHICA moment?
Within months of it becoming public.I think it was two years ago when PM's crashed.
Got to give the PPT kudos for keeping it going this long.
But all Ponzi's come to a nasty end.
Well, on the brighter side, three of the types of weeds that grow on my property are edible. The bad thing is that I don't like two of them. I don't like the red rooted amaranth (pigweed) or the malva neglecta, but the purslane is actually pretty good. I don't even have to cultivate those. Lamb's quarters is supposed to be edible too.
"I saw that Cliff Chart published on the St. Louis Fed Bank publications back in February of 2008 that demonstrated that Reserves were all of the sudden NEGATIVE rather than positive. "
Without the 'Kanjorski' suspension of accounting rules the entire 'western' post=Bretton Woods global trade/finance system would have completely unwound.
IMHO, there is still a very high likelyhood of cascading self-feeding hyperinflationary episodes.
'Moneyness' and 'Collateral' will eventually be re-priced.
Risk and Time Values have meaning and cannot be ignored or subverted by misallocation of real resources -and more importantly- the squandering of human capital/lives simply cannot persist indefinitely. Sooner or later the knives are comming out whether TPTB want to believe differently or not...
It's like watching a daytime soap. One year later and the patient is still in a coma and the relatives are still fighting amongst themselves for the inheritance.
Excellent analogy. This is as slow motion as it gets.
I present you: Guiding Light with over 15.762 episodes in a stretch of 57 seasons...
https://en.wikipedia.org/wiki/List_of_television_programs_by_episode_count
And you only needed to watch 114 episodes over the span of 57 seasons to know what was happening.
Part of me says "Well, I guess it's FINALLY gonna happen. They've run out of room to kick the can."
Then I remembered.... end of June.
ROFL. Germany needs the Euro to remain weak so their exports will remain strong. If they get rid of the Euro deadbeats like Greece the Euro soars and Germany's exports sink. As a matter of fact if Germany was back on the Deustchmark their currency would probably be worth twice the current Euro value. Exports would stall and soon they would also look like Spain, Portugal and Greece.
So Germany is playin' their tough bluff card and the know it. They have way to much to lose and Greece knows it.
However, it's fun to watch the drama unfold play by play on Zerohedge. It's already guaranteed at the last stroke of the midnight hour a deal will be reached. Until then enjoy the doom porn..
"So Germany is playin' their tough bluff card and the know it. They have way to much to lose and Greece knows it.
However, it's fun to watch the drama unfold play by play on Zerohedge. It's already guaranteed at the last stroke of the midnight hour a deal will be reached."
Totally right, HungryPorkChop. Today, Standard & Poors have even issued a statement according to which the non-payment of 6,7 million euros by Greece would not qualify as a default and wouldn't even lead to downgrade their sovereign rating.
A last-minute agreement will be found. The Eurogroup will pay.
Too dangerous for the euro otherwise.
Dude, don't you have like a fuckin job? You're always in here with your original comments...............................I bet you live in your parents house!
Yeah, throw them in that briarpatch!!
Go suck on Drudge's tit. onesided neocon shit
http://www.blogcdn.com/www.aolnews.com/media/2007/08/putinshirtless.jpg
'Elegance'...ha ha, life is so full of irony.
Quote from Vietnam War -- "We had to destroy the village to save it!"
Complex system theory --- it takes one snowflake to ignite an avalanche.
You sound angry. Do you hold Greek bonds? I don't see any Russia pivot, that is a non starter due to geography and the NATO counter reaction.
Will they be using a Jimmy Hat before they proceed?
Hmmm, there's a problem in Greece?
I had no idea.
pods
Ebola has been lost some where in the scare cycle. We need some new bigger scarier boogie men. The old ones have lost their impact.
Yeah, where the hell is that crisis actor Jihadi John when we need him?
Bank runs in Greece will start tomorrow on this news. Might be the extra pressure that is needed to put Tsipras in line.
lol - don't capital controls only work if there is $$$ in the form of deposits in the greek banks???
i see this ending 1 of 2 ways:
1. germany writes a check with actually $$$ out of their coffers from the surpluses they've been running
2. the ECB prints euros & pays off the $$$ greece owes to the IMF, the ECB (ECB paying off itself just like our federal reserve pays interest to the treasury department from the bonds they buy from them - a personal favorite of mine; borrow $$$ from yourself & pay yourself interest with $$$ that never before existed), and to the greek pensioners.
all-the-while, continue to lie about no-inflation anywhere at-the-same time we've never higher prices for stuff in our lifetimes (and it will keep going up while CPI, PPI will continue to "print" flat-to-negative".
Either Greece goes bust and leaves the Euro or a deal is reached and in two years we have to put up with all this bollocks all over again.
The only realistic way I can see Greece staying in the Euro and paying it's debt is to allow Greece a payment holiday to sort their house out and then let them pay less over a longer period (by the way this is exactly what UK banks did to mortgage holders in trouble after 2008 to avoid to many repossessions flooding the market). Greece needs to be in a position to pay it's principle off and not just the interest.
^^^
if we have to go thru another 2 years of this, im clawing my eyeballs & eardrums out.
i particularly liked the 100-year, zero-coupon idea that was floated last week.
I pretty much tuned it out a year ago. I follow the situation, but never take it seriously, because it always changes the next day. The EU is working hard to expand East, they simply can't afford to lose a nation in this time of influence building. Thus the painful and endless negotiations of a problem without solution within existing frame works of the EU. Extend payments out to longer and longer dates, like 21050 or so.
The EU has been dead ever since it began threatening and imposing capital controls on its own member states. They shat upon the three original pillars that the EU was made of - free movement of people, goods and capital.
If you look in retrospect you'll also notice this period coincides with the Commission (technocrats) taking over the leading executive spot in the EU at the Council's (Heads of States and Gov's) account. A Frankenstein super-state whose BFF is Kohl's giant with the brain of a toddler. It's clear as day the EU's survival as a political project is of great importance to TPTS(houldn't)B, because if Europe goes down it will bring Pax Americana with it...
Greece, just print the euros you need yourself.
As long if you give it a nice name like ELP Emergency Liquidty Printing it's ok.
The biggest capital control is making people use money backed by nothing. How is this legal? It isn't. A court packing scheme was used to force it on us. http://www.thetruthaboutthelaw.com/they-make-you-use-money-that-is-backe...
I'll believe it when I see it. These are just threats - the stakes are too high.
NATO has too much invested in MENA and Ukraine to foresake it's refuelling depot.
Call me silly, but I'm fairly certain that Greece is in this mess because they are out of capital to control.
Wan't just the Dax futures tsat spiked, ES and NQ did the same, stupid bastards.(not you Tyler, the markets)
EURUSD spiked as well. Algos got it all wrong!
I only hope that Greece screws the ECB and the crooked basturds at the IMF for every goddamn cent they've everbeen lent. It couldn't happen to better financial gangsters.
Once again,Bruce Cockburn on the F'n gangsters of the IMF.
https://www.youtube.com/watch?v=68zccrskOqQ
It would be easier to put capital controls on a herd of swimming flying cats.
Just for fun Greece should pass a citizen privacy act and classify their roster of citizens and pass a EU human rights laws banning discrimination in banking on EU citizen origin.
Bullish for Cyprus banks,/ Putin.
Got coins?
So, no bank runs this week. No more depost drawdowns. Yeah, boring.
Ever see the movie "Rollover"?
"Yeah Virginia, it's me. Now listen closely. Go to the closet and get a suitcase. Then get to the bank...."
The DAX futures should really rally when the Greeks formally default and Douche Bank derivatives blow up.
What an upside down world politicians and policy makers have created.
lolz yeah right. Greece defaults and SHTF. DB will be lehman/bear sterns on steriods.
any excuse to dump EUR will do these days ;)
Damn it Janet, don't answer the phone. We have our own issues to deal with. Take a vacation like Europe does........A month at a time.
Everyone saying " Yeh, Greece, just default already, bitches..."
Yeh, I hope they do, and then the house of cards comes crashing down...your debt
Go and suck a fuckin fart for your debt IMF bitches...
Germany is not making any sense. Offering nothing to Greece but deflation and poverty, expecting them to suffer so Germany can benifit.
If Greece leaves the Euro there economy benifits from a cheap currency and oil pipline investments in the hundreds of billions.
All this fight over helping pay back the high interest credit that Germany lent Greece.
German politicans are really going to tank the project they built. Unbelieveable.
And they are usually such a caring people.
What a bunch of SHIT.
http://finance.yahoo.com/news/ecb-keep-funding-lifeline-greece-135251027...
ECB to give CHARITY, but no bailout.
why the fuck are we rallying on that?
You have to see it that way. Europe has cancer, and the cancer is called Greece. Now there´s hope that the cancer gets removed.
Europe has a cancer and it is called DoucheBUNK's exposure in the Derivatives Markets.
Unfortunately the Cancer is inoperable and it will be FATAL...TO THE ENTIRE WORLD.
Fuck DoucheBUNK.
Fuck Germany.
Congratulations.
DoucheBUNKS bad bet on Oil Derivatives will implode the system.
Germany has got the final revenge for World War II.
Because as the dollar devalues assets rise in price according to inflation. The news that Greece will default will be hyperinflationary for fiat debt/currency.
Soooo....Greece leaves and that shines the light on Spain, Portagal, and Ireland. Italy is fucked, but 'dat Pope doe' is the only thing keeping them from burning at the moment. Draghi prints to cover Greeces ass, he better order more ink for the rest of the EU as well. The EU experiment is a failure, but they'll keep going until the bullets fly.
BRING IT MOFO'S!..............DO YOU THINK A PEOPLE WHO LOST 10% OF THEIR POPULATION TO THE NAZIS CAN BE INTIMIDATED THAT EASILY? BRING IT MOFO'S!
The answer is ... yes.
Without doubt.
WWIII
The board is set, the pieces are moving.
It will cost Germany way more to keep Deutche Bank alive after a Greek fallout than to support Greece. Does not make sense but politics never do.....
Germany? No no no, it's GOLDMAN SACHS,
So many deadlines.
So many big ol' nothin's happening after they pass.
Another one coming, and going, this week.
Another can will be kicked.
Prove me wrong.
Have you ever seen the movie Groundhog day? Well, now you have!
Greekhog day....
I posted this over the weekend -- The EU and ECB are going to bypass the will of the people (or at least who the Greek people elected) -- and instead will 'Cyprus some folks' by using the Rothschild trick of controlling the money. Thus they will effectively shut down Greece regardless of Tsipras and will take control of the banks and deposits and gold. The Cypriot legislature didn't really get a vote on what happened -- it just happened when the Cypriot Central Bank sold out to the EU/ECB/IMF. Expect the same for Greece.
Well, right. The Bank of Greece is controlled by the ECB. That´s why Syriza wanted the BoG Governor removed a few weeks ago. Didn´t happen though.
If you like your ELA, you can keep your ELA /NOT
That reminds me, I'll get some feta cheese on the way home.
When you have to close it down, CLOSE IT DOWN. Don't talk.
Words to live by, Tuco.
Air kick.
Is it too late for a bailout...LOL
Hopefully, if they do then Spain, Portugal and Italy will remove themselves from the Eurozone, since they will know that their time will come as well.
Divide and conquer.
Italy and Spain are very industrous and an integral part of the EU economy.
Greece .. not so much. It was a mistake to ever allow them the membership.
The Greeks need their own currency, and fast.
I suggest they start printing today, and call it the euro. That's confuse the fucking ECB.
Right, Greeks! You have four days...YOU KNOW WHAT TO DO...!
HAHA! WE LAUGHED IN THE FACE OF DEATH MANY TIMES! We faced the giant nwo of the time-PERSIA and crushed them twice-you think non-tax paying bitch Lagarde scares us? HAHA! Today is a great day for Greece!
Haha, yeah, dance Zorba.
I BET YOU'RE A SOULESS MOTHAFUCKA! YOU CANT HANG WITH US MOTHAFUCKA-WE INVENTED YOUR WHOLE FUCKIN SOCEITY BITCH!
You are not even capable of running a mediocre state over the past 150 years or more and you think you have invented anything?
Leave him alone, this Sauerkraut in white socks and sandals likes to spit Nazi-speeches.
Why not auction off some islands?
They have like 1200 habitable ones.
Greece could keep the really nice ones that pay for themselves with tourism.
Many of them I'm sure are nothing but liability.
I'm sure the Nordic countries would buy a dozen or so each.
Russia maybe would buy 30 or 40 as winter getaways.
Turkey might want a few if the price was right.
GB could use a dozen or so.
The Baltics would be good for half a dozen.
The netherlands, Belgium at least a handful each.
Heck even Germany would probably like a baker's dozen.
Georgia, Armenia get awful chilly come January.
Seems like Greece could raise quite a bit of cash and at the same time shed some liability of penshioners and what not. It's a win, win, win.
Bitcoin users are not affected by idiotic capital controls.
We haff vays off making you spin on our dicks- Mutti
As goes the Greece so goes the Deutsche bank. As goes the Deutsche bank so goes the EU.
So let's see who will chicken out first...
That's all fine and well. They may attack Greece financially in order to coerce compliance. They may even attack Greece militarily if it comes to it ("peacekeepers" after induced social unrest).
But "they" will NEVER EVER let Greece leave either the Eurozone or the EU.
Greece, IMF, Germany, EU can't take a piss without asking Janet, USA first.
Its off to the woodshed
Any cash left in the system will be evaporated come next week
These deadlines are nothing but horseshit. This is about the 20th deadline Greece has passed already. The operative question here is, "Which Weekend?"
There never was an EU. it has always been Germany and the second class citizens.They make it sound that they are only contributors to the Eu funds.They do not like Nazi humor or any ctiticism.Berlusconi can attest to that.They pulled all the strings in Italy's political process. Geeks were doomed when they brought up WW2 crimes.Even if they had an agreement Alexis Tsipras would have been forced out within 6 monts.
Already defaulted in substance. Now it is just negotiating terms of a tenacy agreement with Greece as the Tenants. Big Players who really matter in the market are largely hedged. Markets are getting immune to all these defaults and EU/IMF "hot air".
Of course, there is still juice for traders as there are the Deutsche Banks around who are stuck. Play for bail-outs when CEOs as in the case of DB jump ships.
No one knows the specifics for Greece, but here’s what happened in Cyprus:
ATM withdrawals were capped at 300 euros a person per day. Transfers of more than 5,000 euros abroad were subject to approval by a special committee. Companies needed documents for each payment order, with approvals for over 200,000 euros determined by available liquidity. Parents couldn’t send children that were studying abroad more than 5,000 euros a quarter. Cypriots traveling abroad could carry no more than 1,000 euros with them. Termination of fixed-term deposits was prohibited, while payments with credit and debit cards were capped at 5,000 euros. Checks couldn’t be cashed.
How would capital controls be put in place?
An element of surprise helps. In Cyprus it started with a long bank holiday, between March 16 and March 28, 2013. That gave the country time to negotiate an accord with euro-area member states and the International Monetary Fund. Banks re- opened with restrictions in place and a recapitalization plan for the country’s financial system, which included the imposition of losses on deposits.
Who decides?
It’s up to the government. Under a 1993 law, the central bank governor can impose restrictions, but he needs the finance ministry to approve his decision on the same day.
How long might it last?
There’s no real limit. Cyprus kept controls in place for two years, even though they were supposed to be a temporary emergency measure. Limits on transactions gradually eased over the two-year period, before being lifted completely in April 2015. Experience from other countries, including Iceland, shows that once in place, they can only be removed gradually, after a long period of time. Iceland’s government presented a bill this month to lift capital controls implemented in 2008.
What other impact would they have in Greece?
They would buy time. That could give Greece the breathing space to strike a deal with creditors over a bank holiday, albeit at a huge cost. The limit on corporate transactions and deposit withdrawals would hurt retail sales, tourism, industry, imports and virtually every other sector of economic activity.
Would Tsipras have any options?
Not really. If the government let banks hit the limits on emergency funding, the financial system would run out of money within days with savers rushing to withdraw as much cash as possible, while they still could.
That would almost certainly push Greece out of the euro area since no economy can function without liquidity. Even if the government plans to leave the currency bloc, capital controls would still make sense, as they would stop the clock until it manages to print a new currency.
Are capital controls legal?
In very rare cases. While the free movement of capital is one of the four basic freedoms of the European Union, restrictions are possible under “strict conditions on grounds of public policy or public security.” The European Commission allowed Cyprus to do it, the only instance on record, saying there was significant risk of “complete destabilization of the financial system.”
http://www.bloomberg.com/news/articles/2015-06-16/how-greek-capital-cont...